The High Cost of College Administrators

Wonder why college has become so expensive? The Goldwater Institute, a Phoenix-based conservative public policy research organization, says it’s all about administrative costs. According to the organization’s latest publication:

Universities are suffering from “administrative bloat,” expanding the resources devoted to administration significantly faster than spending on instruction, research and service.

Between 1993 and 2007, the number of full-time administrators per 100 students at America’s leading universities grew by 39 percent, while the number of employees engaged in teaching, research or service only grew by 18 percent. Inflation-adjusted spending on administration per student increased by 61 percent during the same period, while instructional spending per student rose 39 percent.

This is a very interesting revelation. While the cost and just sheer size of college administration has long seemed a little questionable, until now it’s never really been clear how much this cost has accelerated over time. The reason for this growth, according to the report, is that students actually don’t pay for much of this administrative cost: “the lion’s share of university resources comes from the federal and state governments, as well as private gifts and fees for non-educational services.”

It’s worth pointing out that the fact that tuition is rising and administrative costs are similarly rising does not necessarily mean, however, that the tuition increases are entirely explained by administrative costs.

Rising administrative costs may be inefficient (in fact, they almost surely are), but administration accounts for less than 20 percent of college tuition across institutions.

Read the full report, “Administrative Bloat at American Universities: The Real Reason for High Costs in Higher Education,” here.